A griculture and industry in Slovakia

1. Agriculture and industry in Slovakia General overview

2. Historical evolution of economy • According to common features, evolution of economy in the area of Slovakia can be divided into 4 main periods: • Initial period (till 1920´s) • Second period (1920´s – 1945, 1948) • Third period (1948 – 1989) • Fourth period (1989 – present)

3. Initial period (till 1920´s) Initial periodhad lasted from the establishment of the first manufactures until the 1920´s. It was characterised by the predominance of agriculture (both in employment and production). Agriculture • Agriculture depends strongly on natural conditions. In the past, this dependence was even more significantthan nowadays. • Agriculturewas the key economic sector until the 20th century. • The first systematicagricultural measures (such as TheresianUrbarial Regulation, three-field system, changes in the surface water regime) have been adopted since 18th century. • Nevertheless, agriculture had mostly a self-supplying character and its efficiency was low. • Underdeveloped agriculture was not able to supply sufficiency of food for growing population, especially in mountainous regions. This was one of the main reasons of the massive emigration at the turn of the 20th century.

4. Initial period (till 1920´s) Industry • Rich sources of raw materials were the driving forces of pre-industrial and industrial development. In the Middle Ages mining towns were the centres ofstrongly developed regions. • Themostof the raw materials were exploited in neogene volcanic mountain ranges (copper, gold, silver) or in the old paleozoic rocks and magmatites of the inner-carpathian mountain ranges (iron ore, antimony, pyrites). • Thurzo-Fugger company (est. 1495) soon acquired a monopoly on the trade of copper and became one of the most important medieval trade companies in Europe. • Exploitation and processing of metals in 17th and 18th was on high technical level. • In the second half of 19th century (circa 100 years later than in Western Europe) began the industrial revolution itself – e. g. establishment of thefirst factoriesofthemodern type, wider use of steam engines, construction of railways,etc. • In 19th century and also in thebeginningofthe20th century started the decline of mining. On the other hand, there was a rise of food processing (mills, sugar mills, breweries, distilleries). Wood and leather processing became more significant as well. • In 1910, most of the workers were still employed in small enterprises. Industry as a whole was reaching only a low degree of concentration. Only about 18% of people were employed in this sector.

6. Second period (1920´s – 1945) Second period had lasted from 1920´s until 1945. In some parts of this period there was an equal balance of agriculture and industry, but within the Czechoslovak Republic, Slovakia was retaining its agricultural character. Between 1945 and 1948 took place a short period of the after-wareconomic recovery. Agriculture • After 1918, Slovakia became a less developed part of the newly established Czechoslovak Republic. • Although more of the indicators had improved, agricultural production was still very dependent on natural conditions. Also the level of using of theagricultural mechanisation was low. • Very negative impact on agricultural production was caused by the First Vienna Arbitration (of 2 November 1938). Slovakia had lost more than 10 000 km2 of its area including its most fertile soils, large sources of both surface and ground water and more than 860 000 inhabitants.

8. Second period (1920´s – 1945) Industry First years of Czechoslovak Republic meant the tough times for Slovak industry. There were several reasonsof its decline: • lower technological level (in comparison to industry of the Czech part of the state), • loss of markets (successor states of the Austrian-Hungarian Empire had preferredthe development of their own industry) • economic underdevelopment in general, • low purchasing power of population, • global economic crisis at the turn of 1930´s On the contrary, the second half of the 1930´s was the period of industrial rise: • due to the fear of German military policy, important industrial capacities from Czech border regions (Sudetes) were moved to Slovakia, • industrialisation of previously weakly developed regions incentral and eastern Slovakiaaiming to „hide“ some strategic industries (such as chemical plants, metallurgy machinery, production of weapons), • modernisation and wider diversification of industry (BaťaShoeCompany), • during war – production for army purposes

10. Simplified scheme of the industrialisation in the second half of 1930´s Czechoslovak Republic (est. 1918) Moving of industry (mid. 1930´s) Sudetes (Sudetenland) – territory occupied by Germany March 1939 territory occupied by Hungary

11. Third period (1948– 1989) Third period (1948 – 1989) was strongly industrial and influenced by centrally planned economy. Unlike the „West“, economy of the „East“ was not affected by crisis. Only at the end of this period the development of the third sector had started. Agriculture • Development after the year 1948 brought the most significant changes in agriculture which are visible until present, • In 1949 was announced a plan of collectivisation of agricultural production. It was implemented in three stages (1949–1952, 1953–1956, 1956–1969) andconsisted of collectivisation of agriculture and handing over the land, animals and machinery to the agricultural cooperatives. This meant the extinction of the private property in agrarian sector, • During 1960´s and 1970´s, former cooperatives (usually farming on the area of one village) were joining into the agglomerated cooperatives with common management, land and machinery, • Despite of many negative features (small-scale thefts, over-employment, social harms, massive and often improper application of chemicals, increase of erosion, etc.) hectare yields of the most important crops increased threefold in comparison to the pre-war period. To a large extent, food industry was self-sufficient.

12. Collectivisation (simplified scheme) before after

13. Third period (1948– 1989) Industry Socialist industrialisationwas the most important stage of industrial development. The main phase of this process was aimed to a spatially balanced and extensive development of industry implemented through the establishment of large industrial enterprises, • Background of this industrialisation was based on the following "starting points": • Slovakia´s location in relationship to USSR and COMECON* member states – convenient location for the industries based on imported raw materials and also for the export of finished products, • Utilizationof the metallurgical base of Ostrava region – convenient for the development of machinery industry in the north-west regions of Slovakia, • Utilization of the manpower released in the process of collectivisation. • Implementationofthenew industries resulting from technical progress (e.g. chemical industry) or from increasing of the living standard (e.g. manufacture of electrical equipment) • Utilization of local natural resources and raw materials – e.g. sawmills and paper mills in forested regions; cement factories near limestone; breweries and bakeries in the regions with high productive agriculture, etc. • During SI were built more than 300 industrial enterprises and the others were rebuilt and extended. Share of the industry on national GDP had increased from less than 40% in 1948 to 65% in 1985, • Negative features of SI: unfavourable industrial structure with a predominance of heavy industries producing a low added value, low efficiency and dynamics of the industry, almost total dependence on COMECON and USSR, serious(and in some regions extreme) damages on environmentlasting to the present *Council for Mutual Economic Assistance

14. Socialist industrialisation on the example of aluminium smelter in Žiar nad Hronom Coal and cathode mass from Ostrava ... and from Poland Electricity from thermal power plant water – river Hron Cryolite from Czech chemical plants Limestone from Eastern Slovakia Sodium from Romania... Bauxite from Hungary and Romania ... and manpower released from the process of collectivisation

16. Fourth period (1989 – present) Fourth period (1989 – present) is characterised by transition from centrally planned to market economy and a sharp increase of the third sector.In 2009, Slovak economy alsohad to face its first serious economic crisis since 1930´s Agriculture After 1989 started the process of transition and decentralisation of both agricultural and industrial production. The most significant changes in agriculturewere caused by its transition to market economy. Transition consistedofthe following steps: • Restitution of land to original owners (or to their heirs), • Economic transition of cooperatives and restructuralization of agricultural business entities (collapse of the system of cooperatives in state property), • Changes in agricultural policy • Process of restitution brought the formation of private property and thus a new category called „private farmers“, and also significant changes in ownership structures • Most of the agricultural land is still farmed by bigger cooperatives (legal entities) having this land in rent from its owners or from the Slovak Land Fund (Agency) • Since 2004, the decisive role has the Common Agricultural Policy of the EU. Unlike the previous periods,also thenon-production functions of agriculture (e. g.environmental, social, recreational) are becoming more important and supported.

17. Fourth period (1989 – present) Industry As with the agriculture, industry was also facing a difficult transition period after 1989. Alegacy of socialist industrialisationin the form of outdated and ineffective industries, thousands of unemployed, abandoned factories and environmental burdens was a typical „pictureof Slovakia“ from the early 1990´s. At the same time it was aninitial state of industrialtransformation, which lastedforthe next 20 years. Industrial transformation was implemented through the following measures: • Privatisation– changing of the state ownership into private, • Restructuralization– changing the production programmes in order to achieve the competitiveness of products in the conditions of market economy; implemented through: • Conversion of arms industry – almost all industries (in particular machinery industry) were, to a certain extent, connected with the arms industry • Reduction of mining – e. g. reduction of mining of coal and lignite • Inflow of foreign investments –which had significantly increased since 2000 – era of industrial parks It can be stated, that the transformation of industry was, in principle, successfullycompleted. Contemporary Slovak industry is based mainly on the new-localised industries such as automotive industry (including wide range of its subcontractors), manufacture of electrical equipment (incl. subcontractors) and manufacture of plastics. Also some traditional industries have still the important role: energy supply, food processing, manufacture of basic metals (steel, aluminium) and chemicals and manufacture of refined petroleum products.

19. Conclusions... Current state of Slovakia´s agriculture and industry is a result of long-term development.In line with the global trend,employment in agriculture was constantly decreasing while employment in industry and in third sector was sharply increasing. Very diversified natural and cultural conditions had caused, that each part of Slovakia is different. This is one of the reasons of relatively deep regional disparities. Western part of Slovakia (with capital Bratislava) and the smaller region around the town of Košice in the east arethe most developed Slovak regions. Also the most productive agricultural areas are situated in the background of these towns.Relatively strong concentration of industry can be found in the region of Považie. On the other hand, weakly industrialised regions in the southern part of central Slovakia belong to the most underdeveloped regions of Central Europe. Unemployment rate in thedistrictsof Slovakia in 2013 (%)

20. Thank you for your attention! Dr. Martin Valach Slovak University of Agriculture References: • DUBCOVÁ, A. et al. 2008. Geografia Slovenska. Available on lineat: http://www.kgrr.fpv.ukf.sk/index.php/publikacie/geografia-slovenska • HROMÁDKA, J., 1943, VšeobecnýzemepisSlovenska. In: Novák, Ľ., ed., Slovenskávlastiveda I. SAVU,Bratislava , 332 s. • IVANIČKA, K. 1974. Geografia priemyslu. In Lukniš, M., Princ, J. ed. Slovensko – Ľud, 1. Bratislava, Obzor, s. 9 – 74. • MLÁDEK, J. 1990. Teritoriálne priemyselné útvary Slovenska. Bratislava, Univerzita Komenského, 1990. 296s. ISBN 80-223-0006-3 • www.soga.sk • www.nitrainvest.sk • www.nitrafoto.estranky.cz/fotoalbum/nitra-kedysi/cukrovar/cukrovar-01.html • http://px-web.statistics.sk/PXWebSlovak/